Which of the following situations leads to an unplanned increase in inventories of $2.0 trillion?
A) real GDP = $5.0 trillion and aggregate planned expenditures = $5.0 trillion
B) real GDP = $6.0 trillion and aggregate planned expenditures = $4.0 trillion
C) real GDP = $8.0 trillion and aggregate planned expenditures = $5.0 trillion
D) real GDP = $5.0 trillion and aggregate planned expenditures = $7.0 trillion
E) More information is needed about planned investment and actual investment.
B
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You should invest if a new project if
A) the NPV is equal to 1. B) the NPV is positive. C) the NPV is equal to the discount rate. D) none of these choices.
An externality is
a. always a benefit to the recipient b. always a detriment to the recipient c. an activity that occurs in a business that is unknown to management d. an unintended benefit or cost imposed on third parties resulting from market activity e. an act, caused by a firm located in this country, that has an effect on a person in a foreign country